Down Memory Lane

Travelgate. The first Clinton scandal after Bill became president started in May 1993, when Chief of Staff Mack McLarty fired the seven employees in the White House office that arranges travel for the press corps. The White House cited gross financial mismanagement. (The charge was never substantiated.) The sudden firings created a media uproar, especially when the dismissed employees were quickly replaced by friends and relatives of the Clintons.

Hillary later told the General Accounting Office, in a document prepared by her attorney, that she had no role in the decision to fire the employees, did not know the “origin of the decision,” and “did not direct that any action be taken by anyone” other than keeping her informed.

But her statements were contradicted by evidence, including a long-concealed memo to McLarty and a written chronology prepared by White House aide David Watkins that came to light years later. Hillary, Watkins wrote, had said that “we need those people out and we need our people in” and had made it clear that “there would be hell to pay” unless she got “immediate action.” Another aide wrote that Hillary intimate Susan Thomases had said, “Hillary wants these people fired.”

While saying that no provable crime had been committed, Robert Ray, who had succeeded Kenneth Starr as independent counsel, reported in October 2000 that Hillary’s statements had been “factually false” and that there was “overwhelming evidence that she in fact did have a role in the decision to fire the employees.”

Cattle futures. The New York Times revealed in March 1994 that in 1978, just before her husband became governor, Hillary had made a $100,000 profit on a $1,000 investment in highly speculative cattle-futures contracts in only nine months. Hillary’s first explanation (through aides) of this extraordinary windfall was that she had made the investment after “reading The Wall Street Journal” and placed all the trades herself after seeking advice from “numerous people.” It was so preposterous that she soon had to abandon it. Eventually, she had to admit that longtime Clinton friend James Blair had executed 30 of her 32 trades directly with an Arkansas broker.

In an April 1994 press conference, Hillary denied knowing of “any favorable treatment” by Blair. But the astronomical odds against any financial novice making a 10,000 percent profit without the game being rigged led many to believe that Blair, the outside counsel to Arkansas-based poultry giant Tyson Foods, must have put only profitable trades in Hillary’s account and absorbed her losses. The heavily regulated Tyson needed friends in high places, and Bill Clinton helped it pass a 1983 state law raising weight limits on chicken trucks.

Removal of Vince Foster documents. During the same press conference, Hillary was asked why her then-chief of staff, Maggie Williams, had been involved in removing documents from the office of Deputy White House Counsel Vince Foster after his suicide. Foster had been a partner of Hillary’s at the Rose Law Firm in Little Rock, Ark. “I don’t know that she did remove any documents,” Hillary said. But it was reported three months later that Hillary had instructed Williams to remove the Foster documents to the White House residence. Then they were turned over to Clinton attorney Bob Barnett.

Castle Grande. In the summer of 1995, the Resolution Trust Corp. reported that Hillary had been one of 11 Rose Law Firm lawyers who had done work in the mid-1980s on an Arkansas real estate development, widely known as Castle Grande, promoted by James McDougal and Seth Ward. McDougal headed a troubled thrift, Madison Guaranty Savings & Loan, and had given Hillary legal business as a favor to Bill. McDougal and his wife, Susan, were the Clintons’ partners in their Whitewater real estate investment. Ward was father-in-law to Webb Hubbell, another former Rose Law Firm partner, who was briefly Clinton’s associate attorney general in 1993. Later, Hubbell went to prison for fraud, as did James McDougal.

Castle Grande was a sewer of sham transactions, some used to funnel cash into Madison Guaranty. Castle Grande’s ultimate collapse contributed to that of the thrift, which cost taxpayers millions. Hillary told federal investigators that she knew nothing about Castle Grande. When it turned out that more than 30 of her 60 hours of legal work for Madison Guaranty involved Castle Grande, she said she had known the project under a different name. A 1996 Federal Deposit Insurance Corp. report said that she had drafted documents that Castle Grande used to “deceive federal bank examiners.”

Prosecutors later came to believe that Hillary had padded her bills; she “wasn’t guilty of [knowingly] facilitating nefarious transactions — she was guilty of doing less work than she took credit for,” Jeff Gerth and Don Van Natta Jr. explain in their 2007 biography, Her Way. Hillary herself never took refuge in this explanation.

Billing records. Hillary’s billing records for Castle Grande were in a 116-page, 5-inch-thick computer printout that came to light under mysterious circumstances on January 4, 1996 — 19 months after Starr’s investigators had subpoenaed it and amid prosecutorial pressure on Clinton aides who had been strikingly forgetful. For most of that time, Hillary claimed that the billing records had vanished. But a longtime Hillary assistant named Carolyn Huber later admitted coming across the printout in August 1995 on a table in a storage area next to Hillary’s office; Huber said she had put it into a box in her own office, without realizing for five more months that these were the subpoenaed billing records.